Eddy Cue, Apple’s senior vice president of services, shared insights from his nearly four decades at Apple during a recent appearance on a tech talk show. Cue, who oversees platforms such as Apple Music and Apple TV, pointed to the 2003 launch of the iTunes Store as a turning point for both Apple and the wider music ecosystem.
According to Cue, iTunes fundamentally changed how music was distributed and consumed, offering a legal and convenient alternative at a time when piracy platforms like Napster dominated the landscape. He described the service as a breakthrough that redefined Apple’s approach to integrating hardware, software, and services into a unified ecosystem.
Despite its eventual success, the concept initially faced resistance from major record labels, many of which were hesitant to embrace Apple’s proposal of selling songs at a uniform price of $0.99. Instead, labels explored building their own platforms with varying pricing models and restrictions—an approach Apple argued would fail due to inconsistency and poor user experience.
Apple’s strategy centered on simplicity and user convenience, including a flexible transaction system that allowed multiple song purchases to be bundled into a single billing cycle. This approach not only reduced transaction costs but also encouraged higher overall spending by users.
The gamble paid off quickly. Cue recalled that while record labels had hoped to sell one million songs within six months of launch, Apple surpassed that benchmark in just six days—an early sign of the platform’s massive appeal.
The success of iTunes ultimately became the foundation for Apple’s rapidly expanding services division, which has grown significantly under CEO Tim Cook. In 2025, the unit generated $109 billion in revenue, marking a 14% year-on-year increase and outpacing the growth of Apple’s core hardware segment.
Cue said the experience demonstrated a key principle that continues to guide Apple’s strategy: consumers are willing to pay for digital content when it is delivered through a seamless and well-designed platform.